TP ICAP 9-M Revenues Down, Sees Weak FY Revenue; $427 Mln Rights Issue To Fund Liquidnet Acquisition

TP ICAP plc (IAPLF.PK,IAPLY.PK,IAP.L) reported Thursday that revenue for the first nine months of 2020 was 2 percent lower on a reported basis and 1 percent lower on a constant currency basis from the previous year.

Looking ahead, the company said its trading volumes continued to be subdued during much of the fourth quarter. The company expects revenue for the full year 2020 to be 1 percent lower than the prior year.

The company said, "This demonstrates the resilience of the TP ICAP franchise and the benefit of our diversification strategy, as revenue growth achieved in our Data & Analytics, Institutional Services and Energy & Commodities divisions offset much of the decline in revenue in our Global Broking division in 2020 after a strong first quarter."

Regarding the proposed acquisition of Liquidnet Holdings, Inc., TP ICAP noted that Liquidnet has proved resilient in the midst of the COVID-19 pandemic and is expected to produce strong revenue performance for the financial year ending December 31, 2020.

Separately, TP ICAP announced a fully underwritten rights issue, which is intended to raise proceeds of approximately 315 million pounds or approximately $427 million, to be used to fund the acquisition.

The Rights Issue will be on the basis of 2 for 5 Rights Issue at 140.0 pence per New Ordinary Share.

The Rights Issue is expected to result in the issue of 225,334,552 new ordinary shares, representing approximately 40 percent of the existing issued share capital of TP ICAP and 28.6 percent of the enlarged issued share capital immediately following completion of the Rights Issue).

It was on October 9 that TP ICAP announced the proposed acquisition of Liquidnet for a total consideration of between $575 million and $700 million, comprising cash consideration of $525 million.

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